‘The
human tragedy here is enormous.” What could that refer to?
Civilian deaths in Iraq? Nope. The devastation of New Orleans
and its displaced residents struggling to return? Nope. Perhaps
the millions of foreclosures around the country, people turned
out of their homes and neighborhoods fragmented as empty properties
start a downward spiral? Closer, but no.

The speaker, quoted in New York magazine, was talking
about the takeover of Wall Street institution Bear Stearns
by JPMorgan Chase at the (to them) insultingly low price of
$2 per share. (It was trading at $171 per share last January.)

For those of you who don’t follow financial news, the short
story is this: In the midst of the foreclosure mess, a rumor
started that Bear Stearns, which was heavily invested in subprime
mortgages, was short on cash. In the perception-is-reality
world of the stock market, investors started bailing and Bear
Stearns was quickly in trouble. Fearing that a complete Bear
Stearns collapse would trigger a full-scale Wall Street meltdown
and a global recession, the Federal Reserve moved in and brokered
a deal with JPMorgan, offering to guarantee $30 billion of
Bear’s riskiest assets so it would be a less risky move for
JPMorgan to buy them. The token price was partly to stem criticism
that the Feds were bailing out rich guys again.

It was a shock to the people who worked at Bear Stearns, most
of whom now owned a lot of worthless stock in their own company,
as well as being unsure if they’d keep their jobs.

But the terms in which they painted their loss, even in the
first flush of shock, illustrate well the arrogance of Wall
Street and the financial companies that play God there. “It
has felt like an Enron, but without the fraud,” one told New
York. Um, ‘scuse me? The problem with Enron was
the fraud.

“They
needed to show there was a victim,” another Bear staffer told
New York, while yet another said “The whole idea of
a couple of people deciding we should go bankrupt to teach
somebody—I don’t know who—a lesson? I don’t know how that
serves anyone.”

OK fellows. Deep breath. Sure, JPMorgan is no angel and doesn’t
necessarily deserve to get a sweet deal from the government
on your dime. You’re getting punished the most for something
almost everyone did. That doesn’t feel good.

But listen to yourselves. Wall Street speculation is a high-risk
game. You played it badly, and the rest of the country was
already suffering for your greed. Speaking of things that
don’t “serve anyone,” how about your orgy of loans that balloon
up to rates it’s obvious borrowers were never going to be
able pay, not to mention fees to brokers that encourage them
to steer people with good credit to subprime, high-interest
rate loans? I could go on, but you should know the details
better than I do.

You, Bear Stearns bankers, took on a massive amount of risky
investments and pretended to yourselves and your clients that
they weren’t risky. You knew. Hundreds of advocacy groups
on the ground working with people getting these loans had
been sounding the alarm for a decade. How badly do you really
expect the masses to feel if some of you with the million
dollar salaries who got us into this mess get to experience
foreclosure up close and personal?

Maybe it will teach you a lesson about the fact that no matter
how far removed it may feel, the “work” that you do is grounded
in, and has real effects on, people outside of the finance
world, even people outside of Manhattan (yes, we exist).

Even New York magazine, which ran the sympathetic profile
of a shell-shocked Bear Stearns, noted in a companion article
focusing on JPMorgan and how it set itself up for the deal,
“the irony is hard to ignore: Investment bankers, whose actions
regularly force drastic cost-cutting and job loss on companies
across the world, were reeling from a taste of their own medicine.”

Unfortunately, it doesn’t seem like the take-home lesson is
getting through. It sounds more like the analysis at Bear
Stearns is that the Feds are the bad guys for not interrupting
the free market in the right way at the right time to protect
the right people’s savings accounts (i.e. theirs). Witness
corporate “free-market” capitalism in all its contradictory
glory.

If this makes you want to do more than just shake your head
at the rare and transient pain of the rich, Senator Chris
Dodd (D-Conn.) has an important bill pending, the Homeownership
Preservation and Protection Act, that would ban predatory
lending, which is still going on despite the meltdown, and
hold all participants in the lending process, from broker
to lender to Wall Street, accountable. Tell your senators
and congresspeople that you want Dodd’s bill passed, without
weakening from the financial lobby.